Ghana could become dumping grounds for spare parts – Terkper

The immediate past Finance Minister, Seth Terkper, has said the decision to remove taxes on the importation of vehicle spare parts will make the country a dumping ground for over aged vehicles. “

…From my experience in subsidy, anytime we have a very low tax regime, Ghana given its position, becomes a ground for dumping of goods,” he added. Mr. Terkper made the remark on the Citi Breakfast Show on Friday, in response to the scrapping of tax on spare parts imported into the country by government.

The Finance Minister, Ken Ofori-Atta, made the announcement when he presented the 2017 budget statement in Parliament on Thursday. Mr. Terkper argued that, the move will create a safe haven for smugglers to use Ghana as a transit point to maneuver such products to other countries. “We are going to be a transit point for spare parts coming into the country…to Cote d’Ivoire, Togo, Burkina Faso and beyond.”

He said such the situation will deprive the country from making revenue, and further called on the Ghana Revenue Authority to be equipped to check such activities. “For the implementation, I would ask that GRA is equipped particularly at the boarders to check smuggling,” he added.

The government in its budget presentation for this year, announced the removal of a number of taxes including the 17.5% VAT on financial services, and selected importation of medicines not produced locally, and the scrapping on Kayeyei market tolls.

Scrapping Kayeyei toll discriminatory Many Ghanaians have welcomed the tax cuts, but Mr. Terkper seems not to be enthused. He believes that the scrapped Kayayei toll is discriminatory. The former minister clarified that, although he was not against the kayayei toll exemption, he thinks “they [kayayei] are not the only category [of potters] and you [Finance Minister] may be using discriminatory tax approach.”

“Is it just Kayayei or does it also cover truck pushers or if you go to the north does it cover those who are riding motorbikes, tricycles which is a form of portage and hackers?

So Kayayei is just one form of portage. Is the minister saying that all these are going to be eliminated or is just the use of kayayei to gain some sympathy?”